When a stock's share price is lower than a North Dakota thermometer in February, investors tend to give it the cold shoulder. But as the market warms to a stock's prospects, its price can heat up in a hurry. Alas, you can rarely tell that a stock is melting investors' hearts until after it's made that upward leap.

Taking the market's temperature
But Motley Fool CAPS' proprietary ratings, aggregated from the opinions and accuracy of 165,000-plus members, offer a great way to monitor investor sentiment. Following a CAPS rating trend can help us determine the best time to invest. Let's look at previously rated one- or two-star companies that have recently enjoyed a bump in investor confidence and see whether they're truly heating up -- or headed back to the deep freeze.


CAPS Rating
(out of 5)

Recent Price

EPS Estimates
(This Year-Next Year)

NovaGold Resources (NYSE: NG)




OshKosh (NYSE: OSK)




People's United Financial (Nasdaq: PBCT)




Source: Motley Fool CAPS; NA = not available.

Obviously, this is not a list of stocks to buy -- just a starting point for further research. Yet if some of the best investing minds are taking notice of these stocks, maybe we should too. 

Caution: Contents may be hot
NovaGold Resources and Teck Resources (NYSE: TCK) jointly own the promising Galore Creek project in British Columbia, which has been idled for two years. Some think that makes Teck the better bet, since along with the rest of its assets, it is entitled to half the profits to be realized related to the copper, silver, and gold still residing underground there.

Some, but not all. Hedge fund billionaires like George Soros and John Paulson have been betting that NovaGold is the sleeper here and have been dumping money into the speculative miner. With the floodgates for gold opened in China, they could have made the prescient call (again) and gotten in ahead of the crowd. Not that there won't be competition for China's riches: Barrick Gold (NYSE: ABX), Newmont Mining (NYSE: NEM), and just about anyone with a pick axe to dig will be vying for attention.

Although the hedge funds were early, NovaGold's share price is up only 7% since the start of this year. CAPS member nathanjohnson is one who doesn't think it's too late: "The new joint venture in Alaska ... it'll take a little time, but it'll get there. The right people are in the right place to get this project started and to see it through to the end."

Smoking gun
Firemen are typically residents of the municipalities they work in, meaning they and their families have a lot of influence when it's time to go to the polls. There are few scenarios local politicians envision being worse than angry fireman and their supporters railing about how safety is being compromised because of antiquated equipment. Many times, what firemen want, firemen get.

Which is why we might not want to write off truck maker OshKosh. Although it's been living on borrowed time with the M-ATV defense contract it beat Force Protection (Nasdaq: FRPT) and General Dynamics out for last year, firefighting equipment comprised more than one-fifth of OshKosh's revenues in 2009. It's a lower percentage so far this year (because it sold its European business last October), and defense still gets the lion's share of attention, followed by access equipment like aerial work platforms. But fire protection vehicles remain an important component of the business going forward.

As CAPS member BudandMolly notes, OshKosh's specialized vehicles are needed throughout various industries.

This is a beaten up stock that has great value. They are a leader in specialized vehicles and have a lead in specialized vehicles for the military. Low P/E with moderate future growth.

You can bank on it
Regional bank People's United Financial reported results that were in line with expectations, but it continues to suffer as a result of the financial malaise still gripping the country. Net income came in at $16 million, which after stripping out special items like merger expenses, amounted to $0.09 per share, slightly better than the $0.08 a stub it reported last year.

Yet People's has been trying to grow through expansion and recently purchased two more banks. Although seen as having avoided the worst of the financial crisis, the banks credit metrics continue to worsen. Net loan charge-offs as a percentage of average loans rose 30 basis points, nonperforming loans totaled $220 million compared to $168 million last year, and the ratio of nonperforming loans to total loans was 1.56%, compared 1.15% in the year ago period. Non-performing assets rose 15% year over year but were up 56% just from last quarter.

bigmike7 thinks People's more conservative nature will serve it well in the future, while Tero45 sees technical reasons why the bank will underperform. Deposit your thoughts on the People's United Financial CAPS page an let us know whether it's time to withdraw our support for this stock.

Checking the mercury
Are these stocks invitingly warm or bitterly frosty? It pays to start your research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made all from a stock's CAPS page. Then weigh in with your own thoughts on which stocks you think are hot little numbers, and which offer cold comfort. It's free to sign up.

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Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.